The European Parliament has been urged to support the creation of public registries of corporate ownership. This suggestion has been made by a Washington DC-based research and advocacy organization.

Global Financial Integrity (GIF) studies and promotes policies designed to curtail illicit financial flows. Its latest research project revealed that USD68.9bn flowed illegally into and out of developing and emerging European Union (EU) member states in 2011. Bulgaria, Croatia, Latvia, Lithuania, Poland, and Romania were the worst hit.  These financial flows are made possible by the use of entities structured in a way that aims to conceal the beneficial owner of the financial flows.

In order to tackle the phenomenon of these so called “phantom firms,” governments need to be able to identify the beneficial owner of a company when it is formed. By making this information available to the public, the EU would be able to achieve greater transparency.  Businesses, individuals and countries could know with whom they are doing business, and civil society organizations, journalists, and investors could hold individuals accountable for their companies’ actions.

Members of the European Parliament (MEPS) are scheduled to vote on key revisions to the EU’s Anti-Money Laundering Directive on February 13.